Monday, October 22, 2007

Would you prefer rice or cement?

Another rice producing region will be gone soon. This time we're talking about Kecamatan Bayah, Kabupaten Lebak, Banten - an area dubbed "rice deposit" by Kompas. Next year, Bayah may be replaced by a complex of Boral cement factories.

It's interesting that the most urbanized and urbanizing area in Indonesia is Java - which is also the most fertile and productive area for rice-growing. My colleague and I once tried to find data on how much productive rice fields (sawah, not just any agriculture areas) in Java have been converted into urban areas. We didn't succeed.

On the one hand, it's ironic that we have all this fuss about the pros and cons of rice import, but we're quite calm about another productive rice field being converted into urban/industrial functions. When it comes to this, it seems that we only care about the amount of money being paid to farmers/landowners to purchase the land, not about the loss of fertile land. [My personal take is that landowners shouldn't be paid 100% in cash - but some of the payment should be in the form of stocks or bonds.]

On the other hand, should we let this happen - considering/assuming that cement has more value than rice?

Update: Bayah seems to be growing economically. Kompas reports the increase in gold shops, electronic stores, franchise minimarkets, and hotels over the past few years. They wonder whether these may be related to Bayah's readiness to welcome PT. Boral Indonesia, the envisaged economic locomotive of South Banten.